When Does a Partner Recognize Gain on a Distribution

question 72

Multiple Choice

When does a partner recognize gain on a distribution?

• A)In a liquidating distribution when the fair market value of the property received exceeds partnership interest basis.
• B)In a nonliquidating distribution and the property received exceeds the fair market value of the partnership interest.
• C)In a nonliquidating distribution and the cash received exceeds the basis of the partnership interest.
• D)Gain is not recognized until the property received for the partnership interest is sold.

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Definitions:

Associations

The company one keeps, as in family, friends, and other role models who help shape one’s life; important determinants of individual character.

Self-Concept

An individual's understanding of who they are based on their beliefs, characteristics, and values.

Heteronomy

The condition of being influenced, controlled, or governed by external forces or other people, as opposed to autonomy.